Small and medium-sized banks will no longer have to comply with many of the strict new regulations put in place in the wake of the global financial crisis of a decade ago.
The U.S. House on Tuesday joined the Senate in voting to roll back portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which in 2010 placed vast new regulations on financial institutions across the country.
In a bipartisan showing, House representatives voted 258-159 to ease the rules on community and regional banks.
Tuesday’s vote is another legislative victory for President Donald Trump, who promised to undo Dodd-Frank.
The Senate approved the rollback earlier this year.
“Since 2010, Dodd-Frank hasn’t lived up to its false promises,” GOP Rep. Randy Hultgren of Illinois said after Tuesday’s vote.
“It’s time for real reforms that make it easier for small businesses to get a loan, remove unnecessary obstacles to home ownership and ensure community financial institutions have opportunities to compete with too-big-too-fail banks.”
While freeing banks with less than $250 billion in assets from the stricter regulations, the legislation also includes reforms for credit bureaus and adds new protections for seniors and veterans.
“This consensus legislation has strong bipartisan support in both chambers of Congress and acknowledges that not all financial institutions pose the same risk to taxpayers, especially Main Street community banks and credit unions in Illinois and nationwide,” Hultgren said.
Congressman Conor Lamb, a Democrat from Pennsylvania, opposed the rollbacks.
“Before the recession, if you deposited a dollar in your bank, they would keep approximately three cents on hand, and then loan out or invest the rest,” Lamb said in a statement.
“After Dodd-Frank, many banks keep more like 6 or 7 cents on hand for each dollar someone deposits. We should not go backwards.”
Lamb said banks are seeing record-setting profits and the Dodd-Frank regulations protect taxpayers.
“With common-sense regulations in place to protect the money that consumers deposit, people can have more confidence that their bank will better protect their investments,” he said.
After Trump signs the measure, fewer than 10 major banks will still be subject to the full Dodd-Frank regulations.
A version of this article previously appeared on the Watchdog.org website.
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